Clean Development Mechanism and Technological learning

Clean Development Mechanism and Technological learning

Asel Doranova, PhD student, United Nation University – MERIT, The Netherlands

Introduction to the research topic

The Clean Development Mechanism (CDM), one of the three instruments of the Kyoto Protocol was designed to address the global climate change while promoting sustainable development. The CDM is expected to encourage cost-effective investment by a private or public entity from developed-countries (the so-called Annex I countries) in ‘clean’ projects in developing economies (the non-Annex I countries). In addition to the primary goal of reducing greenhouse gases (GHG), CDM is also expected to simultaneously assist developing countries in achieving sustainable development. In this respect, CDM projects are believed to promote the transfer of modern GHG abatement technologies to developing countries. Despite being frequently claimed, the potential of technology transfer via CDM projects has been under-investigated in the academic area. One of the reasons being the fact that CDM is a recent initiative and those CDM projects that have been put into operation have a rather short history. Yet assessment of their technological impact is an emerging issue in the development agenda[1].

Our research aims to address this issue by studying the technology-sustainable development prospect of the CDM, with particular focus on technological capability building and learning. Central in our approach is the argument that technology cannot be transferred easily and costless among countries, and more important, a successful technology transfer requires recipient countries to have capabilities to assess the need, select, import, assimilate, adapt, and develop the appropriate technologies. Sustainability of the technological development is ensured only if these capabilities are in place. In this line, the main question is whether CDM is an effective mean of promoting technological development of developing economies and placing them towards a more climate friendly growth trajectory. The objective of our research is to investigate the implication of the CDM projects for developing countries in terms of their technological learning skills and knowledge acquisition.

The group of studies addressing technology transfer under CDM is still small and looked into dimensions such as technology needs, technology selection and subsequent profit performance, domestic policy frameworks. There have been no attempts to investigate the impact of CDM projects in terms of technological learning by recipient countries.

Objectives and approaches of the present paper

The intention of the present paper is to provide a theoretical background for studying technological learning under the CDM. Our tasks are to present a conceptual framework and propose a number of hypotheses for the analysis. In this study we argue that an appropriate examination of technological learning under the CDM projects must be done within the theoretical frameworks of technological change in developing countries based on the systemic approach. The advantage of the systemic approach is that it would allow us to have more complete and therefore objective view on the learning process through, first, capturing interactive dimension of the learning process including analysis of roles of various actors in the learning system under the CDM, tracing links and channels of knowledge flows among them; second, analyzing institutional and political factors that facilitate or inhibit effective learning under the CDM. We begin with a review of the concepts that we intend to ground our research on, further frame them for the CDM case and define the factors that could be important in explaining technological learning under the CDM.

In the present research our working concept will be the concept of “technological learning system”. We choose to use the notion of ‘learning’ instead of ‘innovation’ (which is more common) for the reason not to put extra emphasis on the innovation process and its results, but to concentrate our attention on accumulation of knowledge, skills, expertise that give potential for innovation, as well as improvement of the operational and production processes that would not necessarily claim to be innovation. Moreover, it has been argued that innovation, in general, is a phenomenon alien to late industrializing economies. The process of technical change typical of these economies, is essentially a process of learning, rather than of innovation.

Main characteristics of the “learning system under the CDM” are that it is, first of all a network of actors (project participants). Second, these actors interact with each other. Third, we expect that interaction facilitates learning; in other words, learning through interaction takes place. Fourth, learning under CDM takes place in a certain institutional context that influences on effectiveness of the capability building process.

Furthermore, in our study we will try to capture a more comprehensive picture of the learning system by capturing the following aspects:

·  Assessment of potential for learning by the CDM project participants.

·  Studying various factors: institutional, organizational, political, country context etc. that directly or indirectly influence the process of learning/technological capability accumulation under the CDM process. In doing this analysis we are expecting to benefit from the theories of innovation system, knowledge system and learning system.

·  Analyzing interactive network of project participants with the perspective of “learning through interaction” and networking concepts. We see importance in investigating links and knowledge channels between CDM project network members.

The paper is organized as follows. The first section discusses technological development versus climate change mitigation issues and provides background information about global initiatives addressing climate change mitigation, including UNFCCC and the Kyoto Protocol and more detailed information about CDM projects. In addition it describes technology transfer perspectives under the UNFCCC and CDM for developing countries and reviews the idea and elements of the framework for technology transfer under the Climate Change Convention. Further sections review theoretical concepts that will be applied in building conceptual framework: technology transfer, technological learning, technological spillovers, innovation, learning and knowledge systems, learning through interaction and inter-firm/inter-organizational networks. This present conceptual framework aims to build a basis for the research design and methodological setting of the PhD research project.